How Do I Incorporate or file an LLC?
Let's say you are starting a business, or you are ready to graduate from a self-employed solo owner to a company structure. You may be thinking about the decision to incorporate or file for an LLC (limited liability company).
One question I get asked frequently is: "How do I go about incorporating or filing an LLC? What do I do? Where do I start?"
You have three options when filing to incorporate or establish an LLC:
(1) do it all yourself by going to the Ohio Secretary of State website and following instructions there;
(2) hire an attorney to assist you, including getting advice on which structure is most advantageous; or
(3) use one of the online services that will help you file incorporation/LLC paperwork.
Option #1, doing it all yourself, is not for the faint of heart. You really have to know what you're doing. And you have to be willing to read a lot and figure things out on your own. If you get frustrated easily and if legalese baffles you, skip this option. In fact, unless you have some experience filing incorporation papers (say, for a previous employer) or you are an attorney or paralegal, you might want to think twice or three times before choosing this option.
Option #2, hiring an attorney, is the safest route. You'll get advice on which organizational structure is best for your situation and the legal requirements you must follow for each structure. You will also get a human being to handle all the paperwork and filing duties for you. If yours is a company that's already of a significant size, or if you have investors or more than one owner, or if you have a complex tax situation, you definitely should see an attorney before taking action. And consult with your CPA or tax advisor, too.
Option #3, using an administrative service to help you prepare the paperwork, is a middle ground that startups increasingly are using. With this option, you do NOT get legal advice -- you're on your own when it comes to the legal ramifications of choosing an organizational structure and meeting the requirements. You just get administrative help with the filing process. And the amount of help that you get varies -- most offer an ala carte menu to choose from. Typically, entrepreneurs use these services when they are just starting a business and want a self-serve option, or are not prepared to or able to pay an attorney under option #2. Or when they are a sole proprietor filing for a single-person LLC and have an uncomplicated tax situation.
My goal in this article is NOT to advise you on the pros and cons of any of the above 3 approaches. Rather, I would just like to point you to some of the convenient resources you can find online to help with the process should you choose the third option above.
- The Company Corporation - http://www.corporate.com
- My Corporation - http://www.mycorporation.com
- LegalZoom -http://www.legalzoom.com
- BizFilings - http://www.bizfilings.com
Most of these services also have guides and resource materials on their websites that provide background information about incorporation and LLCs, so you may want to do some background reading first. Such services can be convenient and easy, and they are inexpensive (roughly $150 - $400). But remember, you are not getting legal advice.
